Hilton Worldwide Holdings Inc., the hotel operator owned by Blackstone Group LP (BX), filed to raise $1.25 billion in a U.S. initial public offering as lodging shares trade at close to their highest level in six years.

The world’s largest hotel chain plans to use proceeds from the offering to pay down debt, according to a regulatory filing today. New York-based Blackstone, the world’s largest manager of alternative assets, will own a majority of the voting power in Hilton following the IPO, the filing shows.

At $1.25 billion, the IPO would be the largest for a lodging company and would move Blackstone closer to realizing gains from its biggest single investment, with more than $6 billion of equity invested from its real estate and other funds. The offering coincides with increases in industry revenue and income that have spurred stock gains for hoteliers such as Starwood Hotels & Resorts Worldwide Inc. (HOT) and Marriott International Inc. Both are trading close to their highest levels since 2007.

“For Blackstone, it doesn’t make sense to keep something this valuable on the books,” said Jeffrey Sica, who oversees about $1 billion as chief investment officer of Morristown, New Jersey-based Sica Wealth Management LLC. “Hilton’s business has been doing well, so it makes very good sense for them to do it now.”

The McLean, Virginia-based hotel operator didn’t say how many shares it will offer or at what price. The offering amount is a placeholder used to calculate fees and may change. Deutsche Bank AG, Goldman Sachs Group Inc., Bank of America Corp. and Morgan Stanley will arrange Hilton’s IPO, the filing shows…

Read the rest of the article at Bloomberg.

Hilton Worldwide Holdings, the hotel company owned by the Blackstone Group, filed for an initial public offering on Thursday, seeking to raise at least $1.25 billion in what will be one of the most closely watched I.P.O.’s of the year.

Though details of the offering were not yet available, Hilton could be valued at about $30 billion once it goes public, capping a remarkable turnaround for what was once considered one of the worst deals of last decade’s private equity boom.

Blackstone took Hilton private in 2007, paying $26 billion for the company, which is based in McLean, Va. The deal was among those that came to symbolize the outsize ambitions of buyout shops in the years before the financial crisis as firms including Blackstone went after ever-larger targets.

Hilton did not disclose the precise sum it was looking to raise or how it intended to price shares. But Blackstone does not intend to issue so many shares that it loses control of Hilton. Instead, the private equity firm will continue to own a majority of the voting shares, allowing it to control the makeup of the board.

With comparable hotel chains like Starwood and Marriott trading at about 12 times earnings before interest, taxes, depreciation and amortization, and Blackstone growing at a healthy clip, its valuation could be about $30 billion by the time shares start trading, which is likely to be sometime early next year….

Read the rest of the article at the NY Times.